“The next move on gold will be driven by an equity market correction,” Chief Executive Officer Peter Grosskopf said in an interview at Bloomberg headquarters in New York. “It’s a pretty safe bet that if equity markets start to look volatile and dangerous then a lot of money will flow into gold as a hedge to that.”

A recent spate of hawkishness from global central banks has pressured gold prices, which have fallen about 5 per cent since early June. The Bank of Canada raised rates on Wednesday for the first time since 2010 and other central banks from the U.S. Federal Reserve to the European Central Bank have indicated their willingness to tighten monetary policy. Gold tends to weaken in periods of rising interest rates, which bolster the U.S. dollar.

Yet Grosskopf said developed economies aren’t as strong as some economists are forecasting, and rate hikes may not come as quickly as the market believes.

“We think the underlying economies and the strength of the economies can be debated,” he said. “If you look at the underlying statistics, it’s a lot less evident that the economy is strong.”